Located at the southern end of North America, Mexico is one of the most important economic partners to the United States and Canada. Mexico’s rich history and its ever growing economy has turned the country into an appealing destination for digital nomads. The country’s strong university system also makes Mexico one of the best places to recruit developers, marketers, and other knowledge workers.
Hiring in Mexico has become a popular way to tap into the Latin American marketplace.
When you hire in Mexico your business will have:
Lower employer costs
Close proximity to the United States and the rest of North America
Access to top talent
Access to an educated workforce that is bilingual in both Spanish and English
To hire in Mexico from a different country (such as Colombia or the US), you have three options:
Outsource with a PEO
Partner with an EOR
Open a subsidiary
If you’re looking to build out your team in Mexico and sell products in the country, it might be advantageous to open an entity or subsidiary.
Although opening a subsidiary gives you the opportunity to tailor your business needs to Mexican culture, the process can be costly and expensive.
You’ll need to:
Set up a local branch with a local bank account
Register with local institutions like the Mexican social security department (IMSS)
Maintain a presence in the country
Find law partners
Hire an accounting firm to run payroll
Hire an internal HR team
For companies that want to build a large team in another country and have their own entities, using a PEO solution service is one option.
PEO companies act as co-employers and manage the HR process. However, they do not accept nearly as much legal responsibility for the entity in the country. If any compliance issues pop up, the PEO service will likely pass these problems over to the parent company.
An EOR is responsible for local HR processes, such as:
Maintaining compliance with local employment laws and other regulations
Drafting compliantly employment contracts in the correct language
Managing payroll and taxes, including withholdings and deductions payments as well as things like 13th payments
Administering local benefits, such as private health insurance and mental health resources
Administering profit sharing for employees (which is mandatory in Mexico)
Recently, Via helped a startup in Mexico hire over 100 workers. The company needed to hire frontline workers as well as managers immediately, and didn’t have the time to wait 6-12 months for an entity set up. Via allowed this business to hire workers in 2-3 weeks total.
To learn more about employer-of-record (EOR) providers in Mexico, visit our Mexico EOR page.
Mexican companies can also hire independent contractors, known as honorarios. Honorarios do not usually receive benefits such as private healthcare or stock options, since they are contracted to work on a specific project or offer a specific service.
When you hire a contractor in Mexico, you have to meet REPSE (Registry of Providers of Specialized Services or Specialized Works) requirements. You are only allowed to hire contractors that are registered on this database of specialized service providers.
Independent contractors usually fit these parameters:
Are they working in more than one specialized job area?
Are they providing a specialized service that a full-time employee can’t?
Do they have their own ability to hire help?
Do they have additional income(s)?
If you partner with an EOR service, you can avoid misclassifying employees and compliance fines which normally include back payments and benefit payments.
In this article, we’ll explore the hiring process, regardless of if you choose to partner with a Mexico EOR or PEO or open your own subsidiary.
If you’re looking to recruit top talent in Mexico, some of the most popular job boards to post listings in the country are:
All three of the above job boards are excellent for finding talent for the digital landscape in Mexico, with Opiconemploe having over 200,000 monthly visitors throughout Latin America per month.
At Via, we can help connect your business to local recruiters in Mexico that will help you hire workers, including executives.
Another great option for finding talent is to hire students who are enrolled in work-study programs. There are almost 1,250 universities in Mexico to choose from.
Work-study programs in Mexico allow you to recruit new talent from students already enrolled in programs in Mexico, with the aim of eventually hiring them on as interns or full-time employees.
Top work-study universities in Mexico:
Metropolitan Autonomous University (Mexico City)
Monterrey Institute of Technology (Monterrey)
When hiring talent, make sure your business offers competitive employee benefits in Mexico like 13th month pay, vacation, and premium health insurance outside the country’s social security system. An EOR partner can help you craft the perfect benefit packages to recruit top talent.
As a recruiter, you should be aware of the following employment laws that govern all employees in Mexico:
Mexico labor laws at a glance:
Minimum wage: The federal minimum wage in Mexico is 178.87 pesos per day. Closer to the Northern Mexico border, the minimum wage is 260.34 pesos per day
Working hours: Monday-Friday or Monday-Saturday 8am-6pm
Vacations: 12 days per year and a mandatory 6 days must be taken
Salary payments: Semi-monthly
In Mexico, it’s important to distinguish between what type of contract an employee is working: indefinite (full-time), permanent, or contractor.
All employment contracts in Mexico should include:
Name and nationality
Services provided by employee
Place(s) where work is provided
Vacation and benefits
Via makes hiring talent around the world and building your global team seamless by helping you onboard workers in as little as 2-3 business days. With our easy-to-use platform, Via helps you manage local HR processes for direct employment such as work visas & permits, employee data privacy compliance, benefits, global payroll, background checks, and more. Our team of local labor lawyers and on-the-ground experts provide 24-hour local support and ensure that your company remains compliant while expanding abroad. As your employer-of-record/entity abroad, Via assumes responsibility for employment liability, so that you can focus on what matters: recruiting and managing your team.